Benefits of Compounding
Why Is It So? Let Us Understand
In Compounding, interest is generated not only on the initial invested amount but also on the previously accumulated interest. Reap the benefits of Compounding by investing early to achieve your financial goals.
Mr.A
Age 25
Starts investing for his retirement
₹ 50,000 p.a.
Age 30
Starts investing for his retirement
₹ 62,500 p.a.
Mr.B
When they turn 50, they both had invested
₹ 12,50,000 each.
However, their investment or holding value were different.
Let us see what is their investment value when they turn 50.
Value Of Investment
We assumed that both earned 10% returns (compounded annually) on their investment.
Let us see how their investment grew over years
Benefits Of Compounding
1
Starting early gives you the benefit of investing smaller amounts.
2
Staying invested for longer help you in getting better returns.
3
Proper planning can help you achieve your financial goals.
Disclaimer:
This Information is awareness of Mutual Fund and general understanding. Also not intended to be as offer or solicitation for the purchase of sale of any financial product or instruments. Reader of this article are advices to take independent professional advice for before investment.
Mutual Fund Investments are Subject to market risks, Read all scheme related document carefully.
